Overspending during holidays can lead to host of problems

By By Warren Arceneaux / American Press

he desire to please loved ones through gift giving can be hard to resist, but giving into emotion could like to financial

problems.

“Emotions drive all the spending that people do for the holidays,” said Allison Gibbons, professor of Family and Child Studies

at McNeese State University.

“There are the positive feelings of

love, friendship and gratitude that people want to express to one

another through gift

giving. Emotions of family ties also make people travel to be with

loved ones at Thanksgiving and Christmas. Feasts have historically

been used for celebrations, and feasts involve having an abundance

of specially prepared meals at these times, and inviting

others to share the meals with us. It so happens that gifts and

feasts mean that extra money is needed.”

Emotion can lead to bad decisions.

“The negative side of the emotions mean that we may have feelings of shame, guilt, failure and inadequacy at these times if

we cannot participate in the gift giving and festivities because of lack of money,” Gibbons said.

“Many people feel depressed around the

holidays for these reasons. Therefore both positive emotions as well as

negative emotions

drive us to overspend and max out the credit cards during the

holidays. The idea of gift giving in religious tradition involved

some sacrifice — that is, you do without something for yourself so

that you can give to someone else. Also, the cost of the

gift was not important. Unfortunately, some of those ideas have

gone out the window, and we end up wanting to impress others

with the cost of the gift, and we also have our eyes on items for

ourselves as well.”

Using credit to purchase gifts can also lead to long-term problems.

“If your credit card bill for purchases made during last year’s holiday season is not yet paid off in full by this holiday

season, then you are overspending and will only make your debt situation worse by adding more expenses to the credit cards

for this year’s holiday season,” Gibbons said.

“If last year or the year before, you

borrowed money from friends, relatives, took an advance on your wages or

salary, took

out a car loan to be able to spend freely for the holiday season,

and those loans have not been repaid before this year’s

holiday season, then this year your strategy must be different and

you have to approach the holidays differently where your

enjoyment of the holidays with family and friends is not based on

how much money you spend.”

Stores will often tempt customers with credit offers during the holidays.

“People should avoid the lure of taking out new store cards during the holidays just for spur of the moment shopping for things

you cannot afford,” Gibbons said.

“Ideally, credit cards should only be

used to tide you over until the end of the month. Of course many people

need more time

than this because their income cannot support the things they want

to buy. In that case, they should budget in a way that

whatever credit they use for the holidays, can be paid off

completely before next holiday season. Remember that you need to

figure in the interest rates as well.

“The downside of this 12-month payback

system is that there is no guarantee that you will have a job come

January. Saving

a similar amount of money every month for a year prior to the

holidays will be the better plan. Maybe skip the high-level

gift giving for this year and begin saving so that from next

holiday season, you will be on a plan where you will always have

a holiday savings account and avoid credit altogether.”

Poor decisions during the holiday season will leave problems that last long after the celebrations are over.

“Overspending causes emotional, social as well as financial problems. Whenever we overspend, we have buyer’s remorse, guilt

and possibly late emerging depression,” Gibbons said.

“Being a shopaholic is a psychological

problem all by itself. Financial problems mean that you can get into the

type of trouble

through which you can incur a bad credit report, owe thousands to

loan sharks or pay-day loan agencies, your salary in the

future will never be yours because all of it goes to a credit card

or the loan shark; people have lost their cars and homes

due to overspending. Loans are not forgiven just because it was

Christmas or Thanksgiving, or you thought it would be nice

to buy an iPad for your 3-year-old.”